Here’s an excerpt from a letter I wrote to a publishing buddy of mine. It is about how media companies can dig their way out of the hole they find themselves in: print revenue is still down, digital revenue may be up, but not enough to cover print’s losses, staffs still cut to the bone, and seemingly double the deliverables with editors being forced to make magazines and also feed the websites.
I’ve been thinking long and hard for at least a few years about how the publishing industry will salvage their brands in media’s shifting landscape.
A publishing company I worked with recently had some very similar demographics to what I saw at yours:
- Half the magazine readers will be retired in 10 years
- Another third will be dead
- The rest check their smartphones incessantly.
- Mobile is an extremely important piece of the new media landscape (I even wrote a blog about it).
A few years ago, you and I came up with a plan to integrate print and digital. I consider it a success (we got old print guys producing video!), even though the end result is different from the diagrams we drew. Unfortunately, the CMS couldn’t give editors the flexibility they needed to develop stories according to the little colored boxes we drew — even though Rob gave it a good try with the design blog — the infrastructure was simply too antiquated.
There was another stark similarity at the other company: Because the web had to publish every day and print only had to publish every month, there was a serious resource imbalance.
Digital publishing as the first step in print publishing
I addressed the resource imbalance by finding a way for web publishing to make print publishing easier. This is the same concept behind our plan, but the mechanics were a lot different.
We had edit calendars for the magazines to give the ad guys something to (try to) sell against, but rather than write monthly 3,000 word features just in time for the print deadline, I assigned editors segments of the outlines each day/week/month. We’d work on many months’ features simultaneously.
Editors would file 500-word news shorts covering pieces of the overall topics which we could promote in the newsletters. The chief editor could then curate a feature from the highest-clicked web assets — case studies, slideshows, article shorts, hot lists, etc.
The key word is curate
The end game, it seemed to me, was that the print staff would consist of exactly two people: an editor and an art director. Everyone else on staff would produce content for the daily distribution machine — newsletters, web, social media (though social media is more of a two-way distribution network). The concept was based heavily on the Newsstand-only special issue workflow that we had — one editor curating magazines from existing content.
A critical piece of the puzzle at the other company was a simple CMS that editors could use. We chose WordPress.
Another key piece of the puzzle was a machine that could spit out newsletters with very little monkey work. We built a custom machine on a WordPress platform — it was a aggregation-curation tool — that spit out two newsletters per day for our flagship brand. But the machine worked harder than that — it spits out 35-40 newsletters per week for all of the brands.
Disrupt your workflow or get disrupted
What magazines will be 10 years from now is, I think, really pretty simple: whatever the audience wants them to be. Today’s readers — who are almost retired or dead — want a print magazine, so we have to give it to them. Tomorrow’s audience wants different products, and we have to give it to them— but because profitability is still elusive to publishers, we have to do it without spending more money. We need to flip the game on its head.
I spent some time talking to a guy in DC named Sean Griffey, who launched a Mobile B2B company — business news for your phone — called Industry Dive. They had seven verticals when we were talking, and they’ve since ramped up to nine. Sean says:
“It really doesn’t matter if mobile revenue will ever match print or other digital revenue. We live in a mobile world now. If you believe that mobile is a transformative technology, you need to build a business model around it. It doesn’t matter how much money you *used* to make.”
Whether digital will ever match print revenue is the wrong question. Especially if the audience is going to retire or die in the next ten years.
It doesn’t matter what we *used* to do yesterday — tomorrow is going to be something different. Consumers expect great stuff on their phones. If we don’t give it to them, they will forget about us and move on to someone who WILL give it to them.
I’m going to take a bit of a side track here for a minute, please stick with me.
Shrinking revenue is a competitive advantage
When revenue goes down five percent (or whatever) each quarter, we can do one of two things: cut expenses by five percent, or cut expenses by ten percent. If we cut five percent, we are chasing revenue to the bottom of the hill. If we cut by ten, we are racing it there.
If we chase revenue down hill, we’ll be unprofitable quarter after quarter, year after year until we hit the bottom. If we race revenue to the bottom, we’ll be profitable every quarter even as we’re racing downhill.
This is a huge competitive advantage, because most companies don’t cut five or ten percent — they cut three, thinking things will get better soon. As the market shifts, and our competition falters, the company will grow. Yes, it hurts to cut five percent, so you might as well cut ten and get a little pleasure (profitability) with the pain.
The same concept holds for chasing after yesterday’s business models instead of racing to tomorrow’s. We can chase the demographics, or we can double-down on the trend and beat our competitors to profitability.
Some media companies cut expenses (people, magazines) quarterly when they don’t hit their numbers — but they don’t cut deep enough. They chase revenue to the bottom and wonder why they are still sucking wind. Rather than cut deep enough to get in front of the curve and grow out of the hole, the sales guys throw up roadblocks because they are compensated on top-line revenue, not bottom-line profit. This death by a thousand cuts causes the staff to pull waaay back from the company — every quarter, they hit the job boards and update their resumes rather than figure out better ways to help the company grow. They become jumpy, beaten down, disloyal, unenthusiastic, and extremely unproductive. This is a downward spiral.
Big media companies are still laying people off, too (Condé Nast just whacked 70 people, NYT whacked 100) because they are chasing print revenue and demographics to the bottom while upstarts like Industry Dive disrupt their model.
That’s not a good way to meet a challenge. Just some food for thought.